Federal Reports

The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 established the Competitive Bidding Program for durable medical equipment (DME). The program replaces a fee schedule with a competitive bidding process to set Medicare reimbursement amounts in certain areas. In a 2014 letter to OIG, Members of Congress expressed concerns about the program's effect on access to DME and requested that OIG study this issue.

We determined that the Wisconsin Medicaid program could have saved $16.2 million (approximately $9.6 million Federal share) in 2014 if Wisconsin (1) required its Medicaid managed care plans to meet the minimum medical loss ratio (MLR) standard similar to the Federal standards for certain private insurers and Medicare Advantage plans and (2) required remittances when Medicaid managed care plans did not meet the MLR standard. Specifically, of the 11 managed care plans that we reviewed, we calculated MLRs for 4 plans that were less than 85 percent (the minimum MLR standard for large private insurers) during calendar year 2014.